Journal of Happiness Studies

, Volume 16, Issue 6, pp 1493–1507 | Cite as

Job Satisfaction and Reference Wages: Evidence for a Developing Country

  • Rodrigo MonteroEmail author
  • Diego Vásquez
Research Paper


Using Chilean data we present evidence about the relationship between job satisfaction, own wage, and reference group wage. We conducted a semi-nonparametric estimation of extended ordered probit models in order to identify the determinants of job satisfaction. Our main result indicates that a 10 % increase in the reference group wage would need to be compensated for by a 24.9 % increase in the own wage to give the same level of job satisfaction. This result shows the enormous importance of the reference group wage for job satisfaction.


Job satisfaction Reference wage Non-observables Semi-nonparametric 

JEL Classification

C14 I31 J28 


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Copyright information

© Springer Science+Business Media Dordrecht 2014

Authors and Affiliations

  1. 1.Departamento de EconomíaUniversidad Diego PortalesSantiagoChile
  2. 2.Ministerio de Desarrollo SocialSantiagoChile

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